The Japanese government is set to set up the Nuclear Damage Support Organization ( 原子力損害賠償支援機構) this week, Yomiuri Shinbun reports (9/7/2011). The law to create the Organization was passed on August 3.

The Organization is basically an insurance scheme for the nation's electric power companies and government corporations that operate nuclear power plants, whereby the companies pay into the scheme to get it started and will pay annual premiums in return for the payment out of the scheme in case of a nuclear accident that will require compensating the victims.

The 12 companies including 9 electric power companies (except for Okinawa Electric that doesn't have a nuclear power plant) will pay in total of 7 billion yen (US$90 million) with TEPCO paying the largest share of 2.4 billion yen (US$31 million), and the national government will match 7 billion yen. So the total amount to be paid into the Organization will be 14 billion yen (US$181 million).

The amount of annual premium is yet to be fully decided.

If the amount of compensation exceeds the money paid into the Organization, the government (i.e. Japanese taxpayers) will pick up the tab.

So far, TEPCO has paid out 112 billion yen (as of August 31) as "temporary" compensation ( to be settled later with receipts). Increase in fuel costs for this year is estimated to be 700 billion yen.

All the cost for "decontamination" of the affected areas will be billed to TEPCO (i.e. taxpayers). In Iitate-mura, Fukushima Prefecture alone, the decontamination project is estimated to cost 200 billion yen for the village of about 6,000 residents.

Many Japanese people highly approve of the scheme, thinking now the victims will be fully compensated. What they may not be aware is that the victims will be fully compensated on their dimes (or yen).